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The Gory Details on Newport's Double Miss

By Seth Jayson - Updated Apr 10, 2017 at 1:31PM

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Just the facts, Fool.

Newport (Nasdaq: NEWP) reported earnings on May 1. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 30 (Q1), Newport missed estimates on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue shrank significantly. Non-GAAP earnings per share didn't move. GAAP earnings per share shrank significantly.

Margins shrank across the board.

Revenue details
Newport tallied revenue of $132.6 million. The six analysts polled by S&P Capital IQ wanted to see revenue of $138.2 million on the same basis. GAAP reported sales were 16% lower than the prior-year quarter's $157.2 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.16. The four earnings estimates compiled by S&P Capital IQ predicted $0.27 per share. Non-GAAP EPS of $0.16 were the same as the prior-year quarter. GAAP EPS of $0.07 for Q1 were 59% lower than the prior-year quarter's $0.17 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 41.6%, 170 basis points worse than the prior-year quarter. Operating margin was 3.3%, 320 basis points worse than the prior-year quarter. Net margin was 2.1%, 210 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $143.4 million. On the bottom line, the average EPS estimate is $0.31.

Next year's average estimate for revenue is $590.0 million. The average EPS estimate is $1.35.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 102 members out of 117 rating the stock outperform, and 15 members rating it underperform. Among 32 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 30 give Newport a green thumbs-up, and two give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Newport is buy, with an average price target of $19.77.

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